Airline powerbase shifts to Asia – AAPA

Airline powerbase shifts to Asia – AAPA

The reshaping of the global aviation industry has moved forward dramatically over the past 12 months, driven by carriers from the Asia Pacific region.

Photo by imagemaker / Shutterstock.com

This is the message from the Director-General of the Association of Asia Pacific Airlines (AAPA), Andrew Herdman, who was speaking yesterday at the annual AAPA Assembly of Presidents in Kuala Lumpur.

Addressing media yesterday, Herdman said that “unlikely partnerships” such as JAL-Jetstar and ANA-AirAsia in Japan, along with the launch of so-called “hybrid” carriers such as Scoot and THAI Smile showed that Asia was leading the world in terms of aviation innovation.

“[Asian carriers have succeeded] in terms of fresh thinking and willingness to experiment in a way that changes the proposition for the consumer,” Herdman stated. “If you look elsewhere, when full-service carriers tried to set up low-cost subsidiaries they generally failed. It failed in American and it largely failed in Europe. But I think there are one or two examples in Asia now where subsidiary and associate LCCs are thriving.”

Herdman added that going low-cost or staying full-service is no longer an “either-or proposition” for airlines. “It’s a question of tailoring the different products and recognising the need for [successful] execution.”

Herdman also said there was “some doubt” over the ability of airlines to translate the low-cost model to the long-haul market. “It’s hard for airlines to differentiate themselves in the way that a short-haul LCC can against a full-service carrier with a higher cost structure,” he explained. “It’s harder to get an edge when you’re flying 10-12 hours and your using the same wide-bodies with two classes because one class doesn’t work. So I think the jury’s still out.”

The AAPA Assembly of Presidents continues tomorrow (9 November 2012), with the President and CEOs of the majority of Asia’s airlines meeting to discuss the key issues.